Nasdaq Composite Technical Analysis | Forexlive

Yesterday
was the Presidents Day holiday so the stock market was closed. Today the
trading restarts and it will be interesting to see if the Nasdaq Composite
fades the pullback from the hot US PPI report on
Friday or extends the losses breaking the key levels. In the bigger picture,
the only thing that has changed is some reacceleration in inflation recently
but it’s not yet clear if it’s just a seasonal blip or the start of a trend.

The
Fed is not worried as the members recently mentioned that they expected the
progress towards their goal to be bumpy. In fact, as things stand, we might
just get a delay of rate cuts but not further rate hikes. Given the
reacceleration in economic activity this might keep the stock market supported
until the fears around inflation become stronger.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite last Friday fell into the close following a hot US PPI report. The
price is now near the key trendline so we
can expect a retest where the buyers will look to buy into the dip to position
for a rally into the all-time high. The sellers, on the other hand, will want
to see the price breaking lower to invalidate the bullish setup and position
for a drop into the 15150 support.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that besides
the trendline we have also the confluence with
the 50% Fibonacci
retracement level and the previous resistance now
turned support. What happens around this level will
likely define where the market will go in the next few weeks.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the key support zone around the trendline
marked by the green box. This gives us a pretty textbook trading setup with the
buyers looking for a bounce and a rally into the all-time high, and the sellers
looking for a break and a drop into the next support at 15150.

Upcoming
Events

This week is basically empty on the data front with just
the release of the FOMC Meeting Minutes tomorrow followed by the US Jobless
Claims and the US PMIs on Thursday.